cost & management accounting

[ejazahmed]

The following information was taken from the books and records Ali Manufacturing for the year ended 31st December, 2006.



� Units Cost (Rs.)
Sales during the year 8,000 ?
Opening Inventories: � �
Work in process - -
Finished goods 1,800 ?
Closing Inventories: � �
Work in process 100 ?
Finished goods 2,000 ?
Manufacturing Cost: � �
Direct Material � 30,000
Direct Labor � 20,000
Factory Overhead � 16,000


The foreman has submitted the following cost estimate for the closing work in process Inventory:


Direct material cost Rs. 2,700
Direct Labor cost Rs. 1,000

The company's past experience showed that factory overhead cost tends to fluctuate closely in proportion to direct labor cost.

Required:

Determine the number of units that were manufactured during the year (1.5)
complete the foreman's estimate of the cost of work in process (1.5)
Prepare a manufacturing statement for the year (3.5)
Determine the cost of each unit manufactured during the year (1.5)
Assume that the first cost recorded in the Finished goods account is the first costs to be credited to the account. Determine the ending Inventory of Finished goods and the Cost of Goods Sold. (2)